October 28, 2015

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Where does your $1 to March of Dimes go?

by Anne Paddock

The March of Dimesis one of the most well-known charities in this country with a mission to improve the health of babies by preventing birth defects, premature birth, and infant mortality by enhancing the availability and quality of healthcare and prevention services for women and babies with specific programs (to see which programs are funded in your state, check with the local chapter). Few people can resist contributing to an organization that “helps moms and babies in your community” but before making a charitable donation to the March of Dimes, it is important to understand where your dollars are going.

We all want our charitable dollars to help the needy (in this case, moms and babies) and although most people understand that charities have to spend money to make money and that non-profits need to compensate employees well to retain them, we don’t want our dollars used to pay big salaries and support a lot of overhead. To know where dollars are coming from and where these dollars are spent, it is necessary to read the organization’s IRS Form 990, which ran 92 pages in length in 2014. Since most people don’t have the time to analyze and decipher the financial data reported on the 990 by the March of Dimes, a summary follows:

In 2014, the March of Dimesreceived $196 million in revenue, with the majority ($187 million) from contributions, fundraising events, and grants (the other $9 million came from investment income, program services and other sources).

March of Dimes used Infocision Management Group (IMG) for fundraising telemarketing. IMG raised $7.4 million and were compensated $3.1 million (42 cents of ever dollar raised), netting March of Dimes $4.3 million (58 cents of every dollar). The organization also used Advanced Business Technology for telemarketing. They raised $654,000 and were compensated $188,000 (29 cents of every dollar raised) netting March of Dimes $466,000 (71 cents of every dollar).

The March of Dimes spent $204 million ($8 million more than what they brought in) and were able to because the organization has assets from previous years that were saved. At year-end, they had $70 million in publicly traded securities, $21 in other securities – primarily in a hedge fund, $9 million in cash, $4 million in other short-term assets and more totaling $140 million in assets. Liabilities – primarily accrued pension liabilities and medical benefits for employees – totaled $115 million, leaving $25 million in net assets.

$96 million (49%) was spent on salaries, pensions, employee benefits, and payroll taxes. 129 individuals received more than $100,000 in compensation. 60 independent contractors received more than $100,000 in compensation. 10 executives (President, Executive VP, Asst Secretary, Asst Treasurer, Medical Director and five Senior VP’s) received a collective $3.3 million (ranging from $255,000 to $510,000).

March of Dimesreports First Class or Charter Travel and Tax Indemnification and Gross Up Payments. The reason for Business or First Class travel: to “minimize change fees” when the President of the organization travels.

Of the $96 million spent on salaries, pensions, employee benefits, and payroll taxes, $73 million was paid to employees in program services while $23 million was for employees in management and fundraising.

$29.6 million (15%) was given to 297 programs (primarily domestic).

$19.9 million (10%) was spent on printing.

$13.8 million (7%) was spent on other service expenses (no further detail because this number does not exceed 10% of total expenses so the IRS does not require a breakdown).

$11.2 million (6%) was spent on postage and shipping.

$9.2 million (5%) was spent on travel, conventions, conferences, and meetings.

$8.5 million (4%) was spent on occupancy.

$6.2 million (3%) was spent on telemarketing/data fees, and other expenses (legal, accounting, equipment rental, interest, professional fundraising services, etc).

In other words, a $1 contribution to the March of Dimes was spent as follows:

It is important to note that there are those who will argue that a portion of the printing, other service expenses, postage and shipping, travel, convention, conferences, meetings, occupancy, and telemarketing/data fees should be part of program service expenses but these expenses are not necessarily monies that go directly to help moms and babies. Many contributors don’t want their charitable dollars to go to rent or mortgage payments, lawyers, accountants, telemarketers, hotels, restaurants, convention centers, equipment rental companies, fundraising services, etc. – when these expenses total millions and millions of dollars.

The argument that program service staff salaries (and benefits) benefit moms and babies is a stronger argument in that these people administer educational and outreach programs to help moms and babies. And, yet without knowing what these positions are (the 990 does not provide this information), it is difficult to know how much of the money spent on these staff positions – 37 cents out of every dollar – directly benefits moms and babies (compared to grants given to research).

Based on the IRS Form 990, it appears that 52 cents (37 cents for program service staff and 15 cents for grants and assistance to programs although these entities also have management and fundraising costs) out of every $1 donated goes more towards directly helping moms and babies, although that number may be less depending on what the program service staff positions are. The remaining 48 cents goes to pay the salaries and benefits of management and fundraisers, printing, postage, shipping, travel, conventions, conferences, meetings, occupancy, telemarketing, legal, accounting, interest, fundraising services, equipment rental, and other expenses.

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I would contribute if more went to helping the children. I think you spend way too much on advertising & requesting money than you should. For instance I got a lovely, expensive 2018 calendar in the mail that I could have bought myself & even picked out the one I wanted. Not only o I not want it, I do not need it!. What a waste of money spent on planning, printing, overhead for the advertising company & postage. And I am supposed to think I am donating to help children in need. Your amount that goes to help these children is way to little a % for me to contribute. Some other charities have overhead in the area of 80% or less. You need to cut your expenses & give more to the children who really need it, not a staff member who makes $500,00 working for a charity. Seems to me like he is the charity!

Linda Boylan

Jun 14 2017

Correction: some charities have overhead expenses of 20% or less

Karen Carlson

Jul 21 2017

I no longer contribute as not enough of the funds go to programs. Too much is spent on compensation, repetitive mailings, and telemarketing. My income only allows me to choose a limited number of charities. Therefore, I only give to those that allot 80% or more for programs.

Not a good use of our charity dollars. First class is an excuse for the CEO because of changing schedules. Fully refundable Coach fares (B Class) are half of first class. And a Charter is certainly NEVER required.Until they reach an 80/20 spend, I will not donate. Stop sending ridiculous dimes. It is an offensive marketing gimmick.

Points well taken.Hopefully, they will hear the message sent by donors!

Michael Young

Sep 14 2017

I was going to donate but after a review of the 2014 IRS form 990 changed my mind.

Gerald Wallace

Nov 2 2017

I wish you would stop wasting your money sending almost weekly mail including dimes soliciting donations. We receive about 20 or more requests from charities every week. If we donated to all of them we could not afford to eat. So we have an arrangement with the post office. We give them your mail they keep the dimes and give to the poor in the community. Not going to contribute. The number of charitable requests is ridiculous so now we don’t support any of them.

Jean C Damian

Jan 16 2018

I can no longer give to an organization that pays employee’s exorbitant salaries. Your overhead expense is far too much. Why is it necessary for your personal to. Fly first class?
I receive requests for giving at least twice a month. Some charities only send out mailings once a year. Please take me off your mailing list! I dislike you sending a dime in the mailing!
I will put this in collection plate!

Scott lindsey

May 10 2018

Why not do something about the homeless through out the United states.

Kathleen Wilson

May 20 2018

I received a donation letter in the mail and sadly I will not be donating. Too much is spent on salaries, expenses, etc. I am not financing someone’s lifestyle. I only donate to charities that 85% or more goes to the charity.

Patricia Kelly

Jul 8 2018

I am a Polio survivor from the 40’s. Throughout my adult life I have always given money to the March of Dimes because I believed in helping other children like myself that had physical disabilities. Initially the March of Dimes was started to help these children by placing a CAN on counters at stores and restaurants. One could see those little cans at almost every store which prompted donations. After looking at the break down of where the money actually is going, I will no longer make a donation. I also think the give away gifts are ridiculous because the money should be going to the children rather than the expense of notepads, calendars, address labels etc. I am appalled at the salaries and advertising expenses. I cannot see the justification for it. I don’t know how these people can accept their salaries when so little is going to the children….the real cause for making donations. I will not support their luxurious living habits. Shame on the March of Dimes!!!!!

dian

Nov 1 2018

We have a local organization that has a sale every Tuesday 8-4 and Saturday 9-noon. Everything is donated, the workers are volunteers. It is truly non-profit, well organized. The volunteers sort the donations, price them, get them out into the proper area, a couple cashiers and always busy when they are open. No mailings to clutter your mailbox. Every Tuesday there is a list of what is half-price -half of an already low price. It’s fun for everybody. I end up donating at least 30 times a year and love that I don’t get any thing in the mail from them.

Nick A.

Jan 22 2019

Wow, the CEO makes over 500K lol. Hey I work in silicon valley, and pull 60+ hour weeks with a lot of skilled decision making on my plate. I’ll never see that kind of dough. Well, that settled it for me.